The Premier League side have been dumped out at the last 16 stage in the past two seasons and did not make it past the group stages in 2011/2012 and 2012/2013.
City have begun this campaign with a 2-1 loss to Juventus, but Pellegrini is adamant that they will eventually become European powerhouses.
“We have played Barcelona in the last two years and if we had played Barcelona at Villarreal or Malaga then maybe we wouldn’t have gone so far,” he said.
“This is a very young team compared with Barcelona, Real Madrid, Bayern Munich or Juventus. We are younger than the teams who normally win the Champions League over the last 10 years.
“Our team has only arrived in the last few years and we are improving every season.
“That will continue and I am absolutely sure that we will arrive to be an important team that wins the Champions League.”
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